Italian cable manufacturer acquires U.S. wire manufacturer

The Prizmian company in Milan acquired a manufacturer of current-carrying wire and cable from the United States under the name General Cable for $ 3 billion with a cash settlement.

The purchase price of $ 30 per share represents a bonus to the value of the company's securities in the amount of 5.3% on the last day of trading on December 1, that is, before the announcement of the merger.

It is planned to close the deal in the III quarter of 2019. It is expected that in the first year after its completion, the profit of the European manufacturer will increase within 10-12%.

The acquisition agreement, approved by the board of directors, is still subject to implementation, in such cases, of the final conditions, including its approval by shareholders and relevant regulatory bodies.

New cash liabilities will be used to finance the takeover, along with available cash and bank liabilities.

Prizmian, which produces both electric and fiber optic cables, also plans to issue new shares worth a maximum of 500 million euros.

Kentucky General Cable was established in 1927. Its securities are listed on the New York Stock Exchange.

Net costs of the company for 9 months of this year amounted to 70.5 million USD, and this despite the fact that the company's profit for the comparable period of 2016 was recorded in the amount of 10.2 million USD.

The recession is most likely caused by the sale of assets and the restructuring of the company, including its recent sale of its business in China to the company Mazda Investments.

The company Prizmian, whose shares are quoted on the Italian stock exchange, employs 21,000 people in 50 countries.

As of September 30, 2018, its pre-tax profit was 512 million euros, compared with 488 million euros for the comparable period last year.
The company's CEO, Valerio Battista, said the acquisition would improve his firm's position in the industry by expanding its presence in North America, as well as expanding its area of ​​interest in Europe and South America.